- POSTED: 15 May 2014 14:38
- UPDATED: 16 May 2014 00:15
Agricultural commodities firm Olam International's net profit more than tripled during the three months ended March 31, thanks to gains related to the revaluation its holdings in a Malaysian maker of natural sweeteners.
SINGAPORE: Agricultural commodities firm Olam International's net profit more than tripled during the three months ended March 31, thanks to gains related to the revaluation its holdings in a Malaysian maker of natural sweeteners.
Olam, one of the world's biggest traders of coffee and cashew nuts, earned S$396.1 million in its fiscal third quarter ended March -- up 265 per cent from S$108.5 million in the same period a year ago.
The sharp rise in net profit was due to an exceptional fair value gain of S$271.0 million on its stake in Malaysia's PureCircle Ltd, which was re-classified as an available-for-sale asset.
Excluding exceptional items, operational net profit fell by about 16 percent to S$102.2 million, on the back of higher depreciation and tax charges.
Sales revenue for the quarter came in at S$4.8 billion, up 2.5 per cent on-year.
Commenting on the results, Sunny Verghese, group managing director and CEO of Olam International, said the company is continuing to focus on profitable growth and generating positive free cash flow.
"We are ahead of target in executing our strategic plan initiatives to release cash and optimise our balance sheet. We have achieved a good balance between investing selectively for future growth while continuing to extract value from investments already made," he said.
He added that Olam's operations in Vietnam have not been affected by the unrest, and that the firm has taken measures to protect its facilities.
Due to takeover rules, Olam is unable to comment about the voluntary general offer that's currently underway.
In March, a unit of Temasek Holdings made a takeover bid for Olam, in a deal that values the company at S$5.3 billion.
The offer will close on May 23 at 5:30pm.